Concentrated Liquidity on HOOKED
What Is It?
Concentrated liquidity allows liquidity providers (LPs) to deploy capital within specific price ranges rather than across the full spectrum of possible prices. Built on Uniswap V4’s hooks architecture, HOOKED’s concentrated liquidity model enables LPs to choose where their liquidity is most effective, reducing slippage and improving capital efficiency. Full-range (legacy-style) liquidity is still possible by selecting the maximum span of the price range, but every pool uses the concentrated infrastructure underneath.
How It Works
In a concentrated liquidity pool on HOOKED, LPs define a lower and upper price bound (“ticks”) within which their liquidity is active. When the market operates within these bounds, the LP earns fees proportionally to usage. If the market price moves outside the range, those assets are no longer active (for swaps), though the LP retains ownership and may re-enter or exit via the exit mechanism.
Because HOOKED uses V4 hooks, each pool can support custom behaviors—such as variable fee tiers, dynamic fee adjustments, or reward hooks—without compromising the base mechanics.
Benefits for LPs and Traders
Concentrated positions allow liquidity to be focused where trades are most likely, meaning better price execution and reduced slippage for traders. For LPs, the reward potential is significantly higher when ranges are chosen well, as capital is not “spread thin” across unused price segments. Even for volatile pairs, this model allows LPs to optimize risk by narrowing their active range.
At the same time, full-range (legacy-style) complements ensure that liquidity is always available across the entire price span, which helps with pairs where price discovery is wide or where stability and simplicity are more important than ultra-narrow concentration.
Fee Tiers & Fee Behavior
Because the environment is dynamic, HOOKED supports multiple default fee tiers that LPs can select depending on the volatility or risk profile of their chosen range. Stable or tightly correlated asset pairs might use very low fee tiers, while volatile or exotic pairs will use higher tiers.
Fees are adjusted via oracles and hooks: in calm conditions, fees remain low to benefit traders; in volatile or risky conditions (e.g. high price swings, MEV risk), fees can increase within predefined caps to protect LPs and ensure protocol integrity.
Range Orders & Limit-Style Positions
Concentrated liquidity on HOOKED lets LPs approximate limit and range orders. By placing liquidity in a narrow tick range that lies entirely above or below the current price (or partially overlapping), LPs can wait for the market to reach that range to profit (either in swap fees or when their full token position is converted).
This functions similarly to limit orders: liquidity remains inactive until price crosses into the selected range. While range orders may remain unfilled if the price moves through and then reverses, LPs still earn rewards while their liquidity is active.
Comparison to Full-Range / Legacy Style
While both full-range and concentrated styles share the same underlying V4 infrastructure in HOOKED, concentrated liquidity delivers far greater efficiency in most scenarios. Full-range liquidity remains useful for predictable market exposure, for new LPs, or for asset pairs where price volatility is extreme.
In short, the concentrated model increases earnings potential when LPs actively manage ranges and select pairs wisely; the legacy/full range model trades that increased potential for simplicity and continuous coverage.